Looking for a profitable venture that lets you share your passion for the finest tobacco and vape products with like-minded customers?
Then opening a smoke shop might be a fantastic opportunity for you!
Launching a small business can seem like an intimidating journey, so we’ve broken it down into nine simple steps. Let’s dive into how to open a smoke shop.
1. Identify a Niche for Your Smoke Shop
Before you take any concrete steps to open a smoke shop, you need to spend some time determining how to make your business stand out.
Having a clear vision for your smoke shop will help you make strategic decisions about your location, product offerings, and marketing strategy, so it’s crucial to conduct thorough market and competitor research.
Market research involves learning more about your community and identifying their wants and needs. For example, if you’re planning to open your shop in an affluent neighborhood where the average residents are older and have more disposable income, you might decide to launch a luxury boutique offering fine cigars and pipe tobacco.
The next step to finding the perfect niche for your shop is to size up the competition. Visit other smoke shops in your area and take notes on what gaps your business could potentially fill.
2. Understand the Laws Regulating Smoke Shops
Possibly the most important step on your journey to learn how to open a smoke shop is to learn about the laws and regulations that will apply to your business.
The tobacco industry is tightly regulated, and failure to understand and comply with all relevant rules can result in hefty fines or even the closure of your business.
All states and local governments will have different laws on the books regarding the sale of tobacco products, so make sure to research your area’s legislation carefully. Here are a few key areas to pay attention to:
- Age Verification: All states prohibit the sale of tobacco products to customers under the age of 21. We recommend using a point of sale (POS) system with built-in age verification to guarantee compliance with this critical law.
- Licensure: Many states and cities require businesses that sell tobacco products to have a tobacco retail license. Start the application process early to prevent any delays in your grand opening.
- Advertising: While marketing is an essential aspect of a solid business plan, the federal government and many state legislatures regulate how smoke shops can market themselves.
- Reporting: Some states require that you maintain careful sales records to be presented upon request. A POS system with robust reporting features will help you comply with these regulations.
Staying up to date on the laws and regulations that apply to your smoke shop will protect your small business and your community.
3. Pick the Perfect Location
Now it’s time to find a home for your smoke shop.
Your smoke shop’s location should be visible from the street, easily accessible, and have ample parking. It might also be helpful to create a map of other smoke shops in your area to make sure you’ve put enough space between yourself and the competition.
Some areas might have zoning restrictions that prohibit smoke shops from being near schools or religious institutions, so be mindful of those as well when evaluating locations.
4. Get Your Space Retail-Ready
Part of discovering how to open a smoke shop is learning what elements create a pleasant, welcoming shopping experience for your customers.
Your smoke shop’s layout should make it easy for your shoppers to navigate and find exactly what they’re looking for. For instance, consider grouping similar products, placing cigars with accessories like cutters and humidors, and electronic cigarettes with e-liquids.
You’ll also need to budget for retail essentials like shelving, signage, and shopping baskets to make sure that your shop has a professional look and feel.
5. Stock Your Shelves
Once your shelves are installed in your store, it’s time to stock them!
The types of products you stock should be based on your findings during the research phase. If you’re planning to cater to the most discerning tobacco enthusiasts, you’ll want to carry a curated selection of the finest cigars, loose-leaf tobacco, and smoking accessories.
On the other hand, if you’re hoping to cast a wide net and become your neighborhood’s go-to shop for all things smoking, you’ll want to stock a wider selection of everything including cigars, pipe tobacco, cigarettes, vapes, and newer products like CBD.
Pro Tip: Specializing in new and popular products like CBD, delta-8, and kratom can be an excellent differentiator for your smoke shop, but you’ll need high-risk payment processing in order to sell them hassle-free. We recommend choosing a tobacco industry-specific POS solution with integrated high-risk payment processing to make selling these products a breeze.
6. Invest in the Right Business Tools
Next on your to-do list is to select the right POS system to power your store.
Since running a smoke shop comes with unique challenges, we recommend choosing a POS solution specifically designed for smoke shops.
Along with an industry-specific design, here are some key features to look for as you evaluate your options:
- Built-in age verification to ensure your smoke shop’s compliance with the law
- Inventory management tools designed for smoke shops, including carton-pack tracking
- Custom label printing that allows you to generate labels for individual cigars
- Advanced reporting and analytics to track your shop’s financial performance and your bestselling products
7. Hire a Great Team
Your smoke shop’s success depends on your team.
Your employees greet your shoppers when they come through the door, answer their questions about your shop’s products, and provide top-notch customer service during the checkout process.
Since your team will play such a pivotal role in setting the tone for your smoke shop’s environment, make sure to hire wisely and provide your new employees with thorough training covering these topics:
- Your smoke shop’s product range and how to make expert recommendations to shoppers
- The importance of stellar customer service
- How to use your store’s POS system to create a convenient checkout experience for your customers
Planning regular training will ensure that everyone on your team is on the same page about how to keep your customers happy and your sales high.
8. Plan Your Grand Opening and Market Your Store
The big day is almost here! One of the most exciting parts of learning how to open a smoke shop is planning your grand opening.
Social media can be a great way to generate some buzz for your business ahead of your opening, but be mindful of the laws and guidelines that might apply to your smoke shop’s marketing strategy.
Another way to get your first customers through the door is to offer an enticing grand opening sale. Giving shoppers a chance to save and a reason to check out your business will help you make your very first sales.
9. Build Your Loyal Customer Base
While making a splash for your business’ grand opening is fantastic, it’s even more crucial to continue building a relationship with your community.
To keep the momentum going, consider launching a customer loyalty program that allows your shoppers to earn rewards and access exclusive discounts when they shop with you.
To make the most of this strategy, we recommend choosing a POS system with a built-in customer loyalty program. Your POS system should make it simple to design your rewards structure, enroll new members, and get insights about your most loyal customers’ shopping habits and favorite products.
Successfully Open Your Smoke Shop With Cigars POS
Congratulations on learning how to open a smoke shop in 9 steps! Now you’re ready to make your small business dreams a reality.
Launching your small business can be a tough journey, but have no fear: We’ll be here beside you for every milestone.
Learn how Cigars POS can set your smoke shop up for success by scheduling a live, personalized demo today.
